Wainwright v Cennox plc [2023] EAT 101

Ms Wainwright resigned after her employer misled her about a colleague's permanent appointment to her role during her cancer-related absence. The EAT held the Tribunal erred in analysing whether discriminatory acts under section 15 Equality Act 2010 constituted repudiatory breaches contributing to her resignation.

Facts

The Appellant, Ms Wainwright, had been employed since 2002, with her employment transferring to Cennox plc in January 2018 under TUPE. Following the transfer, her title changed from Customer Services Director to Head of Installations. She was diagnosed with cancer in August 2018 and commenced sick leave. During her absence, a colleague was permanently appointed to the role of Head of Installations, which the Appellant only discovered through LinkedIn in November 2018. The Respondent’s HR Director inaccurately reassured her that the appointment was temporary and would not affect her role. On her return, disputes arose over a new job description and organisation chart, with the Appellant believing she had been demoted. She raised a formal grievance, was met with a disappointed response from the UK Managing Director, and ultimately resigned on 27 September 2019.

The Employment Tribunal’s Decision

The ET upheld the Appellant’s claim of discrimination under section 15 of the Equality Act 2010 in two respects: the permanent appointment of the colleague without input from the Appellant and the related communications excluding her (November 2018), and misleading her between November 2018 and March 2019 about the temporary nature of the appointment. However, the ET dismissed her claims of direct discrimination, victimisation, wrongful dismissal, and constructive unfair and discriminatory dismissal. The ET concluded the reason for resignation was the Appellant’s “erroneous perception of her status” and her inability to negotiate a Director title.

Issues

The EAT had to determine:

• Whether the ET adequately reasoned its conclusion that the discriminatory acts under section 15 EqA did not amount to repudiatory breaches forming part of the Appellant’s reason for resigning (Ground 1).
• Whether the ET misapplied the law on constructive dismissal by failing to conduct a structured analysis as required by Williams v Alderman Davies Church in Wales Primary School [2020] IRLR 589 (Ground 2).
• Whether the ET’s reasoning and application of law regarding ‘ordinary’ constructive unfair dismissal was adequate, particularly in light of Nottinghamshire County Council v Meikle [2004] IRLR 703 (Grounds 4 and 5).

Arguments

Appellant

Ms Cullen submitted that the ET failed to explain why the discriminatory acts, including being misled, were not part of the reason for resignation, particularly when the Appellant had specifically referenced these matters in her resignation letter and witness statement. The Appellant had referred to being misled and lied to for nearly a year. The ET wrongly applied an “effective cause” test rather than considering whether breaches materially contributed to her resignation.

Respondent

Ms White submitted that the ET had considered multiple potential causes and concluded there was one reason only, namely the Appellant’s dissatisfaction over status following the TUPE transfer. The ET had rejected the misleading conduct as a reason for resignation, and that was a complete answer, although she pragmatically accepted that reasoning could have been elaborated. She also accepted that if the discriminatory dismissal grounds succeeded, the ordinary constructive dismissal grounds should also succeed.

Judgment

Judge Keith allowed the appeal. On Ground 1, the reasons were inadequate. Given that the Appellant had expressly referenced the November 2018 discriminatory acts and being misled in both her contemporaneous resignation letter and witness statement, the ET’s mere rejection of these as reasons for resignation “demands an explanation, for which there is not one.” The Appellant was left wondering why her evidence had been rejected.

On Ground 2, the ET misapplied the law by failing to conduct a structured Williams analysis: whether the discriminatory acts amounted to potentially repudiatory breaches of the implied term of mutual trust and confidence; whether the Appellant affirmed the contract; and whether she was materially influenced, even if only in part, by such breaches in resigning. The ET wrongly assumed that one cause necessarily excluded all others. The Judge also noted that any “last straw” need not itself be discriminatory or unreasonable, contrary to the ET’s suggestion at paragraph 199.

On Grounds 4 and 5, the Judge accepted that the ET had not adequately analysed whether the Respondent’s actions in misleading the Appellant, either standalone or cumulatively, amounted to potentially repudiatory breaches. Reference was made to Rawlinson v Brightside Group Ltd [2018] IRLR 180, where misleading an employee to “soften the blow” amounted to a breach of contract.

Disposal

The matter was remitted to a differently constituted Employment Tribunal for reconsideration of the constructive unfair and discriminatory dismissal claims and wrongful dismissal claim. The ET’s findings on direct discrimination, victimisation, and parts of the section 15 EqA claim were preserved. Applying the factors in Sinclair Roche & Temperley v Heard [2004] IRLR 763, the Judge concluded remission to the original ET would risk the appearance of retrospective rationalisation, particularly as the errors involved misapplications of law and not merely inadequate reasons.

Implications

The decision reinforces the structured approach that Employment Tribunals must take when considering constructive dismissal claims founded on discriminatory conduct. Tribunals must: (i) identify whether the conduct amounts to a fundamental breach of the implied term of mutual trust and confidence; (ii) consider whether the employee affirmed the contract; and (iii) ask whether the breach materially contributed to the resignation, applying the test in Williams, rather than asking whether the breach was the “effective cause.”

The judgment underlines that where an employee expressly identifies particular matters in a resignation letter and witness statement as reasons for resignation, a Tribunal that rejects those as contributory causes must explain why. The case also highlights, by reference to Rawlinson, that an employer’s positive misleading of an employee, even if well-intentioned, can constitute a repudiatory breach. The decision is significant for practitioners advising on constructive dismissal claims overlapping with disability discrimination, particularly section 15 EqA, where the same conduct may give rise to discriminatory dismissal if it materially contributes to resignation. The limits of the decision are clear: the EAT did not determine that the appeal must succeed on remaking, and the factual question of why the Appellant resigned remains to be decided by the differently constituted Tribunal.

Verdict: Appeal allowed. The Employment Tribunal’s dismissal of the constructive unfair and discriminatory dismissal claims, and the wrongful dismissal claim, was set aside and remitted to a differently constituted Employment Tribunal for reconsideration. The ET’s other findings, including its rejection of direct discrimination and victimisation claims and its findings on parts of the section 15 EqA claim, were preserved.

Source: Wainwright v Cennox plc [2023] EAT 101